Supervisory Responsibilities

Under MSRB Rule G-27, municipal securities dealers are obligated to ensure their firm and all employees comply with MSRB and SEC rules and all applicable laws. To achieve this result, dealer firms must establish and maintain written procedures as a guide for employee behavior and establish a supervisory system to oversee their compliance.

A supervisory system is a structure that defines who will carry out a firm’s oversight responsibilities and how the oversight will be accomplished. As defined by MSRB Rule G-27, a supervisory system must:

• • Define which member offices are designated offices of municipal supervisory jurisdiction and how they are to be managed
• • Establish a managerial chain of command and attest to the qualifications of the managers it hires
• • Establish and keep current written supervisory procedures that instruct managers how to carry out their responsibilities
• • Conduct an annual compliance meeting with each of its principals and representatives
• • Assign each registered person to an appropriately registered representative or principal who shall be responsible for supervising that person’s municipal securities activities

Office of Municipal Supervisory Jurisdiction (OMSJ). Each Office of Municipal Supervisory Jurisdiction is required to designate at least one principal to be responsible for the supervision, not only for the activities of the registered representatives and other principals in its own office, but also